By JOHN P. TRETBAR
After posting weekly losses, crude prices rose 2 percent Monday, with the Nymex benchmark futures contract trading over $75 a barrel by midday. London Brent was just under $80 a barrel. Crude prices have dropped nearly $20 per barrel in the last two months. Kansas Common crude starts the week at $64 a barrel at CHS in McPherson.
Operators of the Keystone Pipeline took steps to divert a northeast Kansas creek around the area where the pipe spilled 14,000 barrels of crude oil on Dec. 8. TC Energy announced installation of water pumps and an above-ground bypass line, essentially a big hose, to temporarily reroute Mill Creek. As of Jan. 2, the company website noted it had recovered 11,939 barrels of crude oil from the spill zone in Washington County.
Kansas drilling notices were down in December but up for the year. The Kansas Corporation Commission okayed just 70 intent-to-drill notices last month statewide. That's roughly half the tallies from a month ago and a year ago. But the year-end total stands at 1,681, up by 30% from the year before. A search of the website at the KCC returns four new Barton County intents in December, three in Ellis County and three in Stafford County. That brings Barton County's tally for the year to 48 new drilling notices, up from 37 a year ago and 16 the year before that. Ellis County notched 55 intents last year, compared to 29 the year before and 16 for the year in 2020.
Operators spudded 1,606 wells last year in Kansas, up more than 38% from the year before. Total footage topped 4.5 million feet, up more than 30% from the year before. The Kansas Rig Count for the first week of the year was up two in eastern Kansas at 21 active rigs. West of Wichita, the count was unchanged at 28. Independent Oil & Gas Service reports drilling underway Friday on a lease in Ellis County. Operators were about to spud new wells in Barton, Ellis and Stafford counties.
The first new-locations report of the new year shows 17 new drilling permits across the state of Kansas. There were ten west of Wichita including one in Ellis County and one in Stafford County. Operators have already completed 48 wells this year, with 24 east of Wichita and 24 in Western Kansas. Operators in Ellis County completed two wells last week.
Crude inventories increase by 1.7 million barrels.. As of Dec. 30, the Energy Information Administration reports stockpiles of 420.6 million barrels. That's about four percent below the five-year seasonal average. US crude production increased last week by nearly 100,000 barrels per day. Output once again topped 12 million barrels per day after dropping below that mark the week before for the first time in seven weeks. U.S. crude oil imports dropped by more than half-a-million barrels per day. Four-week average imports are down nearly 3 percent from last year.
Sanctions are beginning to take their toll in Russia. Russia's biggest crude-oil export grade is trading at less than $38 a barrel to an ever-shrinking customer base. That's less than half the international benchmark price and well below the $60 price cap set by the G7 nations in response to the Ukraine invasion. Market analysts say the world's third-largest crude importer continues to take advantage, buying large volumes of discounted Russian crude. India is now buying some of Russia's Arctic crude varieties for the first time.
Norway became Germany’s largest natural gas supplier last year, overtaking Russia. German regulators say total gas imports dropped by 12.3% last year. Norway provided one-third of those gas deliveries. Russia claimed just 22 percent, compared to 52 percent the year before.